Minister rules out ending Gift Aid link to income tax

Third sector minister Ed Miliband has shot down the Institute of Fundraising's idea to cut the link between Gift Aid and the basic rate of income tax.

Ed Miliband
Ed Miliband

The institute wrote to Gordon Brown this month asking him to fix at 28p in the pound the rate of Gift Aid charities could claim back. This would spare the sector losing £70m when the basic tax rate is reduced to 20p in April next year.

Miliband told Third Sector he would be "concerned and anxious" about the idea.

"The great thing about Gift Aid is that it's a non-discretionary tax relief," he said. "It's not like something that's linked to public expenditure so the Government can increase or decrease it as they see fit."

Miliband said the sector should instead seek to safeguard the connection with the basic rate of income tax because it meant Gift Aid would be left out of the direct control of ministers.

"I think that's quite an important thing for the sector to protect, actually," he said.

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